This paper develops an approach to drafting corporate law for emerging capitalist economies that is based on the case study of a model statute recently completed for the Russian Federation. The paper describes the contextual features of emerging economies that make the import of statutes from developed countries inappropriate, including the prevalence of controlled companies and the weakness of private institutional, market, cultural, and legal enforcement. Against this backdrop, we argue that the best legal strategy for giving necessary protection to outside investors in emerging economies while simultaneously preserving the discretion of companies to invest is a "self-enforcing" model of corporate law. Unlike the "prohibitive" corporate law that characterized developed economies in earlier periods, self-enforcing law does not regulate or prohibit substantive corporate decisions. Instead, it tightly structures decision- making processes in the company to allow outside shareholders to protect themselves from insider opportunism with minimal resort to legal authority including the courts. Among the many examples of self-regulatory statutory provisions are a mandatory cumulative voting rule for the selection of directors, which assures board representation to minority blockholders in controlled companies, and dual shareholder- and board-level approval procedures for self- interested transactions. In addition to reviewing such specific statutory provisions, the paper addresses the issues of inducing voluntary compliance and structuring remedies in emerging economies, as well as the drafting challenges posed by special classed of investors such as employee-shareholders and state shareholdings. We conclude by examining the implications of the self-regulatory model of corporate law for the on-going debate over the efficiency of corporate law in developed economies -- and particularly in the United States. Working Paper No.104.pdf

105. Competition Versus Consolidation: The Significance of Organizational Structure in Financial and Securities Regulation (Coffee, John C.)The Business Lawyer, 1995

107. The Coase Theorem And Some Puzzles on the Tort/Contract Boundary (Goldberg, Victor P.), Published in Coasean Economics: Law and Economics and the New Economics, Steven G. Medema, ed., pp. 95-103, 1997

In the third of a century since the appearance of "The Problem of Social Cost" much has been written on the efficiency properties of tort remedies. This paper examines two instances in which contracting around default tort rules would have been possible. In the first instance—Coase's railroad spark problem—parties contract around a tort rule which appeared to be efficient. In the second—measurement errors by surveyors of quantity and quality in international petroleum product transactions—parties fail to contract around a tort rule which appeared inefficient. In both instances arguments reconciling the apparently anomalous behavior with economic theory are proffered, albeit with little confidence. Working Paper No.107.pdf

The holder of an asset, uncertain of its value, is concerned about how (and by whom) information about the potential value should be produced. Since information is both costly to produce and potentially valuable, the owners have some incentive to economize whether they bear the costs directly or indirectly (with the direct incidence on buyers and potential buyers). Could a baseline rule—voluntary disclosure and private ownership of the information—be improved upon by either compelling production and disclosure of information or by restricting the owner's right to exclude? Because there is already a large literature on compulsory disclosure, this paper addresses only the no-exclusion issue. Specifically, it critically reviews two previous efforts, one by Posner (emphasizing the relative risk aversion of the owner and others), and the other by French and McCormick (who argue that the owners always bear all the costs). Working Paper No.108.pdf

109. Eminent Domain and Land: A Rationale of the Law of Takings (Jones, William K.)Published in Hofstra Law Review, Vol. 24, No. 1, pp. 1-, 1995

When does government action so adversely affect private property in land as to constitute a "taking," thereby triggering the constitutional requirement of just compensation? The answer to this question depends on the answers to three subsidiary questions: (1) Does the government's action expose risk-averse owners to substantial uninsurable losses? (2) Will the action impede economic progress by discouraging work and saving and investment? (3) Does the government's action seek to obtain public benefits at private expense in circumstances in which taxpayers would not have expended public funds to obtain the same benefits (despite the administrative feasibility of doing so)?

This analytical model is applied to four categories of cases: (1) governmentally sanctioned intrusions on private property; (2) government operations that physically interfere with the use and enjoyment of land (despite the absence of an intrusion); (3) government restrictions on the use of land, including abatements of "harmful" activities, zoning, environmental regulations, and landmark preservation; and (4) rent control. Working Paper No.109.pdf

110. Discrimination in International Trade: The Most-Favored-Nation Obligation (Leebron, David W.)

This paper explores the meaning and application of the most-favored-nation obligation in international trade relations. In focusing on the MFN obligation contained in the General Agreement on Tariffs and Trade, it considers how the obligation in a multilateral context differs from the historical use in bilateral agreements. The paper further analyzes the concept of "like products" used to determine the existence of discrimination. Economic economic concepts, such as cross-elasticity of supply and demand, are considered, but they seem to only partially capture the proper legal application of the MFN obligation. The paper concludes, based on analysis and some historical evidence, that the notion of like products is context sensitive, and differs substantially in accordance with the regulatory purpose asserted. Working Paper No.110.pdf